2004 Annualreport

The central objective of PUMA’s corporate strategy is to become the most desirable Sportlifestyle brand in the world. To accomplish this goal, PUMA aims to achieve desirability by combining design and innovation, a clear distribution channel strategy, and brand building marketing initiatives. Innovation has been a constant throughout PUMA’s history and a cornerstone of PUMA’s growth over the past several years. By incorporating diverse sport and lifestyle influences into our products and by always asking ourselves how can we do things differently, we have forged a unique look and aesthetic identity. And to help ensure that PUMA continues to develop fresh and exciting product, we have adopted an organizational structure that is 2004 geared towards recognizing and incubating ideas throughout the company. The ANNUALREPORT result should always be truly innovative product that reflects our long tradition of top performance combined with distinctive and unique PUMA signature design. PUMA’s distribution is equally important in contributing to brand desirability by making sure the right products get to their targeted consumers in the proper channels. Our distribution system also works together with product lifecycle management that enables us to control brand visibility and extend PUMA’s market potential. Desirability is further enhanced by marketing that develops the brand as an icon at the epicenter of sportlifestyle, creating sustainable brand equity. PUMA supports these efforts with a continuous drive to improve operational efficiency. Our decentralized organization allows for the placement of our competencies in locations where they will be most effective and enables PUMA to realize speed and efficiency throughout the supply chain, and ultimately to better service both our wholesale customers and our end consumers. puma.com PUMA Year-on-Year Comparsion 2004 2003 € million € million Deviation Sales Brand sales 2,016.6 1,691.5 19.2% Consolidated net sales 1,530.3 1,274.0 20.1% Result of operations Gross profit 794.0 620.0 28.1% Earnings before interest and tax (EBIT) 365.0 263.2 38.7% Earnings before taxes (EBT) 370.7 264.1 40.4% Net earnings 257.3 179.3 43.5% Profitability Gross profit margin 51.9% 48.7% 3.2% Return on sales before tax 24.2% 20.7% 3.5% Return on sales after tax 16.8% 14.1% 2.7% Return on capital employed (RoCE) 167.8% 121.0% 46.8% Return on equity 48.0% 46.8% 1.2% Balance sheet information Shareholders’ equity 535.8 383.0 39.9% - Ratio of equity to total assets 57.6% 54.7% 2.9% Working capital 148.4 155.7 -4.7% - in % of Net sales 9.7% 12.2% -2.5% Cashflow and investments Gross cashflow 385.6 280.6 37.4% Free cashflow (before acquisiton) 256.6 137.7 86.3% Investments (before acquisiton) 43.1 27.0 59.8% Acquisition investment 0.0 30.3 Value management Cashflow return on invest 42.7% 43.5% -0.8% Absolute value contribution 222.3 166.3 33.6% Employees Employees on yearly average 3,475 2,826 23.0% Sales per employee 440.4 450.8 -2.3% PUMA share Stock exchange rate at year-end (in €) 202.30 140.00 44.5% Earnings per share (in €) 16.06 11.26 42.7% Free cashflow per share (in €) 16.01 6.74 137.5% Equity per share (in €) 33.37 23.85 39.9% Stock market value 3,308 2,248 47.1% Average trading volume (amount/day) 141,753 125,202 13.2% PUMA Group Development Business phase Momentum Investment Restructuring 2004 2003 2002 2001 2000 1999 1998 1997 1996 1995 1994 1993 € million € million € million € million € million € million € million € million € million € million € million € million Sales Brand sales1) 2,016.6 1,691.5 1,380.0 1,011.7 831.1 714.9 647.4 622.5 594.0 577.2 554.2 541.3 - Change in % 19.2% 22.6% 36.4% 21.7% 16.2% 10.4% 4.0% 4.8% 2.9% 6.6% 2.4% - Consolidated sales 1,530.3 1,274.0 909.8 598.1 462.4 372.7 302.5 279.7 250.5 211.5 199.5 210.0 - Change in % 20.1% 40.0% 52.1% 29.3% 24.1% 23.2% 8.1% 11.7% 18.4% 0.7% -5.0% - - Footwear 1,011.4 859.3 613.0 384.1 270.9 209.0 202.5 193.8 176.2 154.4 143.5 141.9 - Apparel 416.0 337.0 238.5 169.5 163.5 139.0 85.8 73.1 64.4 50.3 49.9 59.8 - Accessories 102.9 77.7 58.3 44.5 28.0 24.7 14.2 12.9 9.9 6.8 6.2 8.4 Result of operations Gross profit 794.0 620.0 396.9 250.6 176.4 141.7 108.2 102.3 94.0 79.0 69.5 62.8 - Gross profit margin 51.9% 48.7% 43.6% 41.9% 38.2% 38.0% 35.8% 36.6% 37.5% 37.4% 34.8% 29.9% License and commission income 43.7 40.3 44.9 37.2 28.9 23.9 24.5 25.9 25.5 26.0 27.1 21.4 Operating result / EBIT 365.0 263.2 125.0 59.0 22.8 16.3 4.7 36.3 33.3 31.0 23.1 -26.2 - EBIT Marge 23.9% 20.7% 13.7% 9.9% 4.9% 4.4% 1.5% 13.0% 13.3% 14.7% 11.6% -12.5% Result before taxes on income / EBT 370.7 264.1 124.4 57.4 21.2 14.4 3.4 37.4 33.2 26.5 17.3 -35.4 - EBT Marge (Return on sales before tax) 24.2% 20.7% 13.7% 9.6% 4.6% 3.9% 1.1% 13.4% 13.2% 12.5% 8.7% -16.8% Consolidated group profit 257.3 179.3 84.9 39.7 17.6 9.5 4.0 34.6 42.8 24.6 14.9 -36.9 - Marge (Return on sales after tax) 16.8% 14.1% 9.3% 6.6% 3.8% 2.6% 1.3% 12.4% 17.1% 11.7% 7.5% -17.6% Expenses Expenses for marketing and retail 214.6 163.9 125.1 86.9 67.0 61.0 47.9 29.0 - - - - Cost of product development and design 36.9 29.9 24.2 19.9 18.2 15.2 15.2 7.3 - - - - Personnel expenses 157.5 126.6 103.0 81.1 64.4 51.5 41.3 35.2 - - - - Balance sheet composition and ratios Total assets 929.6 700.1 525.8 395.4 311.5 266.6 222.9 176.6 147.7 106.5 100.0 121.9 - in % of total assets 57.6% 54.7% 48.0% 44.7% 42.1% 42.1% 43.8% 54.7% 41.7% -12.8% -38.1% -43.5% Net working capital 148.4 155.7 114.0 110.3 78.8 76.6 70.6 69.6 21.2 17.8 6.6 34.1 - thereof: inventories 201.1 196.2 167.9 144.5 95.0 85.1 63.4 58.4 41.9 36.9 33.3 44.0 Cashflow Free cashflow 256.6 107.4 100.1 3.0 9.1 0.8 -12.1 -8.6 39.5 17.7 39.7 -4.6 Net cash position 356.4 173.8 94.3 -7.8 4.8 1.1 7.8 22.0 34.5 4.7 2.5 -50.7 Investment (incl. Acquisitions) 43.1 57.3 22.5 24.8 9.4 14.3 15.7 4.1 2.9 1.8 1.4 2.9 Profitability Gross profit margin 48.0% 46.8% 33.7% 22.5% 13.4% 8.5% 4.1% 35.8% - - - - Return on sales before tax 167.8% 120.7% 81.1% 32.8% 20.6% 17.8% 6.8% 41.4% - - - - Return on sales after tax 42.7% 43.5% 32.2% 20.3% 13.8% 11.1% 4.6% 18.3% - - - - Additional information Orders on hand on Dec. 31 822.6 722.0 531.1 360.1 232.1 187.2 133.5 130.8 111.4 90.9 94.4 85.2 Number of employees on Dec. 31 3,910 3,189 2,387 2,012 1,522 1,424 1,145 1,078 807 745 703 714 Number of employees on yearly average 3,475 2,826 2,192 1,717 1,524 1,383 1,149 1,041 795 728 725 1,012 PUMA share Price of the PUMA share on Dec. 31 202.30 140.00 65.03 34.05 12.70 17.20 11.25 18.61 26.29 18.41 14.93 7.75 Earnings per share (in €) 16.06 11.26 5.44 2.58 1.14 0.62 0.26 2.25 1.98 1.76 1.06 -2.63 Average outstanding shares (in million) 16.025 15.932 15.611 15.392 15.390 15.390 15.390 15.390 15.390 14.000 14.000 14.000 Number of shares on Dec. 31 (in million) 16.062 16.059 15.846 15.429 15.390 15.390 15.390 15.390 15.390 14.000 14.000 14.000 1) including sales of licensees Foreword 06 Mission 08 Management Report 11 Sustained Positive Development of Sales and Earnings 13 Development of the World Economy 14 Strategy of the PUMA Group 15 Sales 16 Results of Operations 19 Dividend 21 Regional Development 22 Net Assets and Financial Position 24 Cashflow 26 Value-Based Management 28 Product Development and Design 30 Sourcing 31 Employees 32 Risk Management 34 Orders Position 36 Outlook 37 Share 39 Marketing 41 Consolidated Financial Statements - IFRS - 59 Consolidated Balance Sheet 60 Consolidated Income Statement 61 Consolidated Cashflow Statement 62 Changes in Equity 63 Appendix to the Financial Statements 64 Consolidated Financial Statements 65 Auditor’s Report 91 Report of Supervisory Board 92 Board of Management 94 inhalt 05 Dear Fellow Shareholder, 2004 was another remarkable year in the development of our company and brand.

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